In a scenario echoing 2016, the Asia-Pacific Economic Cooperation (APEC) summit in Lima is set to unfold amid a tense geopolitical landscape. Once again, the U.S. President, this time Joe Biden, arrives as a lame-duck Democrat to find his agenda disrupted by the shock of Donald Trump’s presidential victory. The situation leaves Biden struggling to uphold a cooperative vision for the U.S. role in Latin America amid growing influence from China, whose leader, Xi Jinping, is poised to dominate the stage.
As Biden faces diminished leverage and an emboldened China, questions emerge about the future of the U.S.-Latin American relationship. The narrative of Trump’s potential return to “America First” isolationism casts uncertainty on the prospect of American engagement in the region, while China’s deepening partnerships showcase a powerful, well-timed alternative for countries across Latin America.
Central to China’s influence is the unveiling of the Chancay megaport, a $1.3 billion infrastructure marvel northeast of Lima that underscores Beijing’s economic sway in Latin America. The Chinese shipping giant Cosco holds a significant stake in the project, highlighting a long-term commitment to regional logistics and supply chains. Peruvian Foreign Minister Elmer Schialer underscores the port’s transformative potential, stating, “With this port, we’re looking at the entire Pacific coast, from the United States and Canada all the way to Chile. The shipping business is being transformed.”
This sentiment is echoed across South America, as neighboring countries explore the port’s impact on their own supply chains. Economists have highlighted how the Chancay port could reshape shipping dynamics by reducing travel time to China by nearly ten days—a strategic advantage that has regional leaders paying attention.
The region’s relationship with China, particularly in the context of trade, has become progressively essential. Data from the Economic Commission for Latin America and the Caribbean reveals that China’s trade with Latin America surged by 35 times between 2000 and 2022, reaching nearly $500 billion annually. Much of this trade is driven by South America’s natural resources, such as soybeans, copper, and iron ore, which have become integral to Chinese manufacturing and infrastructure.
Observers note that the renewed promise of Trump’s “America First” approach stands in stark contrast to Biden’s vision of multilateral engagement, a difference that could impact the U.S. standing across Latin America. Eric Farnsworth, vice president at the Council of the Americas, describes this as a “strategic defeat” for the U.S., adding, “The idea that China is somehow a better partner is increasingly being heard around the region.”
China’s evolving engagement with Latin America stands out not just in trade but also in diplomatic outreach. Since assuming office, Xi Jinping has visited 11 Latin American countries—a testament to his commitment to deepening ties in the region. This month, Xi’s trip includes full state visits to both Brazil and Peru, a courtesy extended by leaders eager to strengthen relationships with Beijing, even as the Biden administration’s influence wanes.
The APEC summit and Xi’s inauguration of the Chancay port underscore a new narrative: Latin American nations are not only receptive to but also eager for the opportunities presented by China. This shift challenges the historical influence the U.S. has wielded in the region. At gatherings such as APEC, where trade, economic integration, and infrastructure investment take center stage, China’s active role reshapes conversations and alliances in ways the U.S. may struggle to counter.
One of the most tangible demonstrations of China’s influence has been its Belt and Road Initiative (BRI), an ambitious project encompassing investments in infrastructure projects worldwide. Latin America joined the BRI later than other regions, but China has been quick to establish significant footholds by funding highways, railroads, and power grids across South America. While some countries have faced debt challenges tied to these projects, China has indicated a more nuanced strategy, now focusing on sustainable development sectors such as renewable energy and telecommunications.
In contrast, U.S. infrastructure investment in Latin America has been limited. Despite Biden’s efforts to promote a coalition-building approach, experts like Benjamin Gedan of the Wilson Center’s Latin America Program note that American companies are often absent from large-scale infrastructure bids in the region. This has frustrated Latin American leaders, who see China as a partner willing to back significant development projects, while the U.S. approach appears fragmented and less committed to addressing long-term growth needs.
The U.S. has tried to counter China’s influence by encouraging Latin American countries to reject Chinese telecommunications giants like Huawei, citing national security concerns over potential surveillance risks. Similar anxieties surround the Chancay port, with some U.S. officials wary of potential Chinese military uses. U.S. Defense Secretary Lloyd Austin voiced these fears recently, warning of China’s intent to “exploit insecurity in our hemisphere.”
For Latin American leaders, the question isn’t about picking sides but rather maximizing opportunities. Economically and geographically tied to the U.S. but seeing concrete benefits from Chinese investments, Latin American countries are navigating their roles carefully. China’s emphasis on trade and infrastructure aligns with Latin American priorities, while the U.S. approach, focused on security concerns and sporadic investments, can seem disconnected from immediate needs.
Margaret Myers, director of the China and Latin America program at the Inter-American Dialogue, suggests that the U.S. misjudges the region’s priorities, particularly in assuming an “either-or” choice between China and the U.S. This is increasingly evident, she says, as countries in the region focus on addressing socioeconomic challenges through development. “All eyes are going to be on the port, what Xi says about it, and how he articulates relations across the Pacific,” Myers noted, adding that the symbolism of the Chancay port is just as powerful as its logistical function.
Some leaders, including Peruvian Foreign Minister Schialer, assert that the U.S. role in guiding regional trade will not disappear overnight, even under a Trump administration. But the influence of American trade agendas is being tested, especially given Trump’s history of unilateralism and threats to dismantle multilateral agreements.
President Biden’s Indo-Pacific Economic Framework, launched in 2022 to counter China’s dominance in Asia-Pacific markets, was designed as a modern version of the Trans-Pacific Partnership (TPP) that Trump scrapped. Biden’s framework aims to build economic resilience and strengthen regional supply chains, theoretically creating alternatives to Chinese networks. However, Trump’s threat to terminate the framework if reelected has cast doubt on its viability.
The uncertainty surrounding U.S. commitments to Latin America under Trump’s potential second term creates additional hurdles for Biden at APEC. His vision of a collective approach, which includes initiatives to integrate supply chains and build alliances, is overshadowed by Trump’s past stance. As president, Trump initiated a trade war with China that disrupted global markets and alienated U.S. allies. Biden, facing the prospect of Trump’s return, struggles to reassure Latin American partners that the U.S. is in it for the long haul.
This week’s APEC summit presents a critical moment for both Xi and Biden. Analysts agree that China sees Latin America as an opportunity to expand its global reach, particularly given the region’s growing role as a supplier of raw materials critical to Chinese manufacturing. In previous years, the U.S. might have enjoyed a dominant role at APEC, driving conversations around trade, cooperation, and shared development goals. Now, however, China is positioned to set the tone.
“The Chinese love the idea of outmaneuvering the U.S. in its near-abroad,” remarked Gedan. “Xi will luxuriate in this dynamic of being able to arrive with a big delegation and to inaugurate this transformational port, which sucks all the air out of the room when his American counterpart is very weak politically.”
China’s clout is on full display as Xi arrives with a large delegation of diplomats and business leaders. The Chancay port has set the stage for a demonstration of power, offering Latin America a preview of what closer economic alignment with Beijing might look like. Meanwhile, Biden’s influence is diluted by Trump’s election win, making it difficult for the U.S. leader to project a clear vision for the region’s future.
